Home reports 'benefited market'

Home reports have not hindered the Scottish housing market, Scotland's chartered surveyors have claimed.

The Royal Institute of Chartered Surveyors (RICS) research found sellers were using the home reports to attract potential purchasers.

And it said the reports allowed potential buyers to find out more about a property's condition and valuation.

But the Law Society of Scotland said home reports had not removed the need to commission more than one survey.

Home reports were introduced in Scotland on 1 December 2008.

The reports are arranged by the seller and include a survey of the house, a study of its energy efficiency and a list of costs such as council tax banding.

There is no doubt in my mind that the home report has benefited buyers and sellers over the past 12 months

Graeme HartleyRICS Scotland

RICS Scotland asked 10 of the biggest chartered surveyor firms in Scotland - who between them carry out about 90% of all home reports - how they thought home reports had affected the market over the past 12 months.

All 10 firms agreed it was the recession that was to blame for the downturn in the housing market, not the home report.

Eight said house prices had not been affected by the home report, while the other two said they believed prices were higher.

Seven firms said home reports have had no impact on the number of homes going on the market for sale.

Two firms thought it had enticed more sellers, while just one said there were fewer sellers since home reports had been introduced.

The results largely mirror a similar survey carried out in February 2009, three months after home reports were introduced.

Graeme Hartley, director of RICS Scotland, said the average cost of a home report for an average property in average condition was about £430 plus VAT.

This is much lower than the £1,000 suggested in 2008 by groups which were opposed to the home report, he added.

'Financial leap'

Mr Hartley said: "There is no doubt in my mind that the home report has benefited buyers and sellers over the past 12 months.

"The home report offers clarity to buyers and sellers about what the property is worth and what condition it is in right from the start and that's what the home report set out to do.

"The home report was not intended to miraculously fix the housing market, but as our survey of chartered surveyors shows, it has certainly not hindered the market."

Home reports are a great step forward for buyers and sellers in Scotland as the vast majority of sellers are also buying property

Julia ClarkeWhich?

The study was welcomed by Housing and Communities Minister Alex Neil.

"This simple tool, which doesn't cost a fortune, has given would-be buyers - about to take the biggest financial leap of their lives - the best possible information upfront", he said.

"Buyers can now keep hold of their savings for deposits, without having to shell out for surveys on properties they don't get to buy.

"There is also much more clarity about the value of a house, with the virtual end to the unrealistic 'offers-over'.

"For sellers it's proving a great way to attract inquiries from potential buyers and guide them on how to prepare the property for sale. In the round, it's good news for everyone."

'Voiced concerns'

Julia Clarke, of consumer charity Which?, said she was "delighted the new system was working well", with the added benefit that first-time buyers do not need to pay for home reports at all.

She added: "Home reports are a great step forward for buyers and sellers in Scotland as the vast majority of sellers are also buying property."

However, Janette Wilson, convener of the Law Society of Scotland's conveyancing committee, said: "The society has consistently backed proposals for property buyers to have more and better information about their prospective purchases but voiced strong concerns about the inclusion of a compulsory single survey in home report packs.

"As we anticipated, home reports have only met some of their objectives.

"While some of our members are reporting that they find them a useful marketing tool, unfortunately the potential difficulties about acceptability to lenders and shelf life are limiting their usefulness for both purchasers and sellers.

"Home reports have not removed the need to commission more than one survey and we are aware that offers 'subject to survey' are still being made.

"The current slow market, coupled with tighter lending restrictions from the banks, has probably made this more obvious."

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